Back in August, we published an article on how rare it is for male bankers to take advantage of new HR policies that grant them as much as 16 weeks of paid paternity leave. Most take no more than a week, while many never truly unplug. The article elicited dozens of critical comments and emails, many of which came from female bankers who pounded the same refrain: men who don’t utilize family leave policies are negatively affecting women. And they weren’t talking about the wives who were left alone to care for a newborn. They were talking about their female colleagues. However unintentional it may be, men who skip out on taking full leave stigmatize family benefits and isolate new mothers as the only people at their firm who stay home when a child is born, several readers argued. A new study from Goldman Sachs suggests they’re right.
In a 41-page research report, six senior female members of Goldman’s investment research division analyzed the gender gap in corporate America and offered some potential solutions. The headliner was actually what they didn’t find. Looking at the 20% pay gap between men and women, the researchers discovered that 17.5 percentage points cannot be explained by measurably factors like education, industry or level of experience, suggesting bias may play a strong role.
The study details a number of factors, but perhaps the most interesting is the argument that family-friendly HR policies including parental leave and ﬂexible working hours can act as a “double-edged sword” for many women.
“Employees may hesitate to ask for or utilize these beneﬁts due to concerns about ‘signaling’ – the risk that managers and colleagues alike will judge taking an extended leave or asking to work on a part-time basis, for example, as demonstrating a weak commitment to the job or lower ambition,” the authors wrote. “This signaling may consign the employee to jobs with poorer career prospects – regardless of whether the perception is true and regardless of whether there is a demonstrable impact on the employee’s productivity or output. So while such ﬂexibility may lead women to stay in the workforce for longer, these beneﬁts may also limit their professional advancement.”
While the report encompasses all industries, the stigmatization of family-friendly policies likely has a greater effect at financial firms that have recently made major changes to improve their benefits packages in an effort to attract more female employees. On paper, banks trounce most companies when it comes to parental leave and other family-centric benefits. Ironically, the changes may actually be hindering career progress for some female bankers, despite the good intentions.
One of the solutions Goldman offers is similar to the sentiment shared by some of our readers: make the policies non-gender specific and have management maintain a culture that encourages male and female employees to use the benefits that are offered, rather than one that discriminates against them.
“Making these beneﬁts available to men as well as to women, and standardizing the processes behind them, can help to reduce any stigma around utilizing such beneﬁts,” they wrote. “Doing so would again reinforce the idea that children, elderly relatives and school schedules are not merely a ‘women’s problem.’’ However, companies need to ensure that such policies have “broad senior-level support and careful oversight in order to ensure that employees who use them are not penalized, intentionally or unintentionally, by the double-edged sword.”
At the end of the day, HR and the C-level suite can only do so much. Men will still need to voluntarily take full leave and managers will need to encourage that they do so. In investment banking in particular, this may require a culture change that takes a while to be felt, at least according to the male bankers we spoke with.
Elsewhere in the report is a warning about what Goldman refers to “glass-cliff promotions,” where women are placed in high-risk seats during challenging times for the company or periods of their career when they’re not ready. This can set women up for failure and reinforce certain gender stereotypes, the authors argue.
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